Monday, January 29, 2007

Climate Premiums


It seems clear that those who are serious about changing our fire burning climate changing ways agree, Cap and Trade markets, although modestly effective, will not do the job we need to get done in the time we have to do it.

What we do not agree on is this:

Quit calling what we need to do a TAX.

It's not a tax. It's the charge we should all pay for using our air as a dump.

Call it a permit. Call it a dumping fee. Call it Elmer Fudd.

Perhaps we should call it a Climate Stabilization Premium.

Just don't call it a Tax.

Well, you may remember Nicholas Stern. He is the former World Bank chief economist and author of the English Government-commissioned report on the economic effects of climate change.

And he agrees with Gore that putting the cost of emitting carbon into the market price is essential to our survival.

Stern favours world carbon tax
Edmund Conway
Daily Telegraph at Davos 2007

Sir Nicholas Stern has spoken out in favour of a global carbon tax, warning that global warming represents "the biggest market failure the world has ever seen".

The former World Bank chief economist and author of the Government-commissioned report on the economic effects of climate change, said environmental taxes should play an essential role in combating global warming.

In a debate at the World Economic Forum, Sir Nicholas, who has since left the Treasury, argued that environmental taxes – such as those on transport and energy – should not be discounted in favour of worldwide carbon markets.

Although he said his comments should not be interpreted as the Government position, his proximity to Gordon Brown will lead many to suspect that further green taxes could be in the pipeline. clip

Climate change has already become the most hotly-debated subject at the meetings in Davos this year, and the debate in which Sir Nicholas took part was one of the most eagerly awaited events of the conference.

Sir Nicholas said that ruling out green taxes was "a risk we cannot take".

"Unless we act quickly and effectively, we will not bring down carbon emissions," he said. "And we must cut our emissions from current levels by around 40pc.

"This is the biggest market failure the world has ever seen. The market hasn't worked because we haven't fixed it." more

The debate's panelists also included Vinod Khosla, founding chief executive of Sun Microsystems, who argued against the proposition that nuclear and clean coal technologies were the only long-term rivals to oil.

Here is Khosla's view from a Grist interview.

"On the technology side, we will see a horse race between clean coal, solar thermal (not photovoltaic), and wind for central utility-grade power generation. I would personally handicap this in favor of solar thermal power because it can be stored easily as heat and is half the cost of solar photovoltaic and is dispatchable by the utility when it is needed, unlike wind power which must be used when the wind blows. Heat is much cheaper to store than electricity and that gives solar thermal technologies (often called CSP for concentrated solar power) a big leg up over wind and photovoltaic.

Contrary to popular belief, I suspect we will find that clean coal plants (often called IGCC plants with carbon capture and sequestration) will prove to be too unreliable and the cost of gasification of coal (the G in IGCC), the separation of carbon dioxide from the waste gases, and compression too high. Liquefaction, handling, and eventually underground storage in large reservoirs will be so expensive that it is likely that solar thermal technologies will win the cost race.

The financial risk of building a fifty year lifetime coal plant will become much more visible in 2007, and utilities that are doing it will see their stock suffer as investors recognize this risk fully!

You have got to be crazy to build a fifty year asset with the escalating risk of environmental regulations and the certainty of carbon pricing at some point which will triple the effective price of coal." more

Anyone who thinks that the CO2 produced from coal can be sequestered needs to take 8th grade chemistry again. One trainload of coal means you've got 3.66 (44/12) trainloads to remove and sequester.

The best way to sequester our carbon will likely be in the biosphere as we induce the markets to allow the earth to grow a beard. But the best way to sequester coal is to leave it where it is.

Yesterday, the chair massage guy at the bookstore asked me what my books are about, so I gave him my 20 second energy vision.

It went something like this.

Every material that humans build or have built will someday be coated with an advanced material that converts photons to electrons. Instead of allowing those photons to de-accelerate into heat, we will use their quantum energy to produce usable electron energy that is stored in an advanced solid state grid that is loaded with capacitance. We will use these same materials in reverse to make our ceilings and walls glow, thus replacing light fixtures. We will use them to suck energy from our bodies, thus replacing standard air conditioning.

When we drive our electric transportation appliances, we will charge them at the red light as the onboard computer recognizes the magnetic charging plate embedded in the road itself. We will drive around all day with never a thought about fuel.

The gas station will become as quaint, and as useless, as the wood shed

When, I saw that I had him, I took it to the next level.

Our surfaces will then become transductional boundary layers, converting one form of energy to another, dividing the creation without dividing it, and thus becoming a technological metaphor for reality itself. Because after all, our divisions of reality are only in our minds.

I read in my new Krishnamurti book that loneliness is simply a blocking of energy.

Clearly, there's a lot of lonely out there.

Who knows, maybe unblocking the energy in our lives and in our world,

will become the Real Climate Premium.


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